The scarcity of new Naira notes presents a chance to revamp our currency system by phasing out the ₦1,000 and ₦500 bills and introducing the ₦200 note as the highest denomination.
This suggestion comes from an expert who believes that it’s an opportune time to do so given the current interplay between micro and macroeconomic activities.
A public affairs analyst, Bala Zaka, has suggested that the Central Bank of Nigeria (CBN) should take advantage of the current cash squeeze to make significant changes to the nation’s currency system.
Zaka believes that the best course of action would be to withdraw the ₦1,000 and ₦500 bills from circulation and replace them with the ₦200 bill as the highest denomination.
Zaka argued that this move would be beneficial in multiple ways, as it would not only deepen the country’s cashless policy but also help to reduce crime. He pointed out that the recent decrease in kidnappings for ransom, which is often paid in cash, could be attributed to the increased use of electronic transactions.
This is because transactions made through banks and other electronic media can be easily traced, making it easier to identify and apprehend criminals.
To further promote the use of electronic transactions and reduce the need for cash, Zaka suggested that the CBN should increase the circulation of lower bills, including more ₦200 notes. By doing so, people would be more likely to use cashless options for transactions, which would, in turn, help to reduce the circulation of physical cash and promote a safer and more efficient payment system.
In summary, Zaka’s proposal to withdraw the ₦1,000 and ₦500 bills and replace them with the ₦200 note as the highest denomination is a timely and strategic move that could deepen the cashless policy and reduce crime.
By increasing the circulation of lower bills, the CBN can further promote the use of electronic transactions and create a safer and more efficient payment system.
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